Is Garrett Motion (GTX) Stock Undervalued Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company value investors might notice is Garrett Motion (GTX). GTX is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.
We also note that GTX holds a PEG ratio of 1.73. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. GTX's PEG compares to its industry's average PEG of 1.88. Over the last 12 months, GTX's PEG has been as high as 2.18 and as low as 0.10, with a median of 0.15.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GTX has a P/S ratio of 0.15. This compares to its industry's average P/S of 0.42.
These are just a handful of the figures considered in Garrett Motion's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that GTX is an impressive value stock right now.
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